The NITI Aayog, the apex public policy think tank of the Government of India, released a report on “Advanced Chemistry Cell Battery Reuse and Recycling Market in India,” recently. The report developed in collaboration with UK’s Green Growth Fund Technical Cooperation Facility aims at promoting battery recycling and the battery supply chain as uptake of electric vehicles increases in India.

The report says that India will have a battery storage potential of 600 gigawatt hour (GWh) by 2030, and demand for electric vehicles, stationary storage and consumer electronics will mainly drive adoption of battery storage. The report undertakes analysis of the overall battery market in India, deep-diving into the relevant policies and regulations; current and estimated segmentwise market sizing; support interventions at central and state level; and the recycling potential of current and evolving battery technologies.

According to the report, the current deployment of lithium-ion batteries (LIBs) in India is dominated by consumer electronics, which comprises smartphones, laptops, notebooks, tablets and is further expected to grow with the digitalisation of platforms and the integration of technology in day-to-day life.

The report points out that in 2020, consumer electronics energy storage was the biggest market for LIBs, with a cumulative market of 4.5 GWh, though EV sales accounted for around 10 per cent of the LIB market (0.92 GWh).

As per the report, between 2010 and 2020, the global demand for batteries grew at a compound annual growth rate (CAGR) of 25 per cent to reach an annual demand of about 730 GWh.

By 2030, the demand for batteries is expected to grow four-fold to reach an annual rate of 3,100 GWh, it said, adding this shows a growth of 16 per cent CAGR through 2020 2030.

The report notes that the electrification of transportation and battery energy storage in electricity grids are expected to be the key drivers in the growth of battery demand.

The recycling volume coming from the deployment of batteries will be 165 GWh by 2030 and out of this, almost 106 GWh will be from the EV segment alone, it says.

The report further adds that a coherent regulatory framework incentivising all stakeholders to participate in the recycling process will help in the development of a battery recycling ecosystem in the country.

Recommendation for battery waste management

Lithium-ion battery recycling is a multistage effort, and the number of processes involved is dependent on the selected recycling route, the input feedstock and the quality of the expected output product, says the report. It recommends steps for effective implementation of battery waste management rules and promoting battery recycling in India. Some of them are 1) disposal of batteries in landfills should be made illegal so that batteries can undergo proper disposal through recyclers; 2) a separate collection agency should be established to help in streamlining both the collection and the recycling of batteries; 3) there should be provision of a separate license for handling lithium ion batteries separate from electronic waste to reduce the minimum requirement for entry in recycling; 4) the Central Pollution Control Board must explicitly state the responsibilities of corporates and the repercussions for their inability to achieve stated responsibilities; 5) a Deposit Refund System should be implemented to provide incentives to customers to return batteries; 6) incentives for manufacturers to meet recycling regulations, such as green taxes, should be provided in order to enforce extended producer responsibility, thereby attaining a higher recycling rate; 7) support start-ups in developing the recycling of battery products is a must to ensure long-term growth in energy storage; and 8) several research organisations can be funded to come up with commercially viable recycling processes with high recovery rates.

Reflecting on the geopolitical risks, the report says that China is the world leader in component manufacturing of LIBs. China leads LIB cell manufacturing with around a 51 per cent share in global cell manufacturing capacity. The country also manufactures 39 per cent (by weight) of the total amount of cathode materials, 27 per cent (by weight) of the total amount of anode materials and 60 per cent (by weight) of the electrolyte materials globally. Without current manufacturing facilities for cell components, India is expected to depend on imports from neighbouring and developed countries to cater to the growing LIB market.

China announced power cuts and several restrictions on the use of power by industries to balance economic growth and tackle climate change. This big decision also affected the global supply chain (thereby increasing product prices) especially from China. India could take advantage of these situations by attracting both global and domestic recyclers to set up LIB recycling facilities in India, the report says.

Opportunities for India

Today, the recycling market in India is at a very nascent stage, and LIB waste is handled by few organised players. According to the report, the battery recycling market in India will become very attractive by 2025. For many years, LIB waste generated from consumer electronics has been the major source of input streams for recyclers. However, with growing support for and acceptance of EVs among stakeholders, the demand for LIBs is growing fast. This will be also driven by demand for grid storage applications like utility-scale storage, telecom towers, home power backup solutions, etc. It is estimated that annual demand for LIBs for 2021 in India is around 5.2 GWh and this is expected to grow at an annual rate of 35–40 per cent up till 2021. These LIBs will reach their EOL by 2030 or before. This is equivalent to 43,000 tons of LIB waste every year assuming average energy density at 120Wh/kg. Since most of these EOL batteries will be sourced from EVs, the recycling industry will benefit from organised collection and transportation of these batteries by OEMs to recyclers.

Battery reuse

Among all applications, EV batteries have high scope for reuse, the report says. Citing a study, it says an EV battery is likely to have around 70–80 per cent of its initial capacity at retirement and its life can be extended about another 10–15 years through use in other applications. EV to EV reuse will have an expected second life of 5 to 10 years, EV to other vehicles will have a second life of 10 to 20 years, EV to EV charging - 10 to 12 years, EV to largescale battery storage - 10 to 12 years, EV to smallscale battery storage - 10 to 12 years.

Key battery recycling players: global and India

As per estimates, total global recycling capacity in 2020 exceeds 100,000 tons/ year. Europe has the highest battery recycling capacity (>52,000 tons/ year) followed by China (>30,000 tons/year). Currently, recycling capacity in India is very low (<2,000 tons/year) but this is expected to increase to 30,000 tons/year in the next two to three years.><2000 tons/year) but this is expected to increase to 30,000 tons/year in the next two to three years.

Recommendations for battery recycling

 The report recommends that the government should promote closed-loop recycling, whereby spent batteries are recycled directly, thus reducing energy use and waste by eliminating mining process. Some of the other recommendations are: Battery manufacturers can forge recycling partnerships as they deploy batteries in EVs to streamline operational processes for collection, testing and recycling; incentives for manufacturers to meet recycling regulations, such as green taxes, in order to enforce EPR, will help in attaining a higher recycling rate; the upcoming battery management rules must explicitly state the responsibilities of corporates and repercussions of their inability to achieve these and battery recycling activity should be included as part of a typical operations and maintenance contract of solar projects in which large battery is associated. For the establishment of recycling centres, standardisation of the battery chemistry is needed, as well as standardised battery forms based on the application, to streamline the dismantling process. LIBs should have labels on their covering based on the recycling process to be used, making it easier to segregate them. There should be a separate license for handling only LIBs, separate from electronic waste. This will reduce the minimum requirement for entry in the recycling of LIBs. All these above measures, if implemented, would help India streamline the processes to ensure the proper disposal and recycling of LIBs in a cost-effective and sustainable manner. Additionally, building a collaborative ecosystem for EV battery reuse and recycling will lay the groundwork for a smart, safe and sustainable future.